Yunnan Water Investment Company (6839) H1 2024 earnings summary

Executive summary

• Revenue for the six months ended 30 June 2024 was RMB1,242.5 million, down 15.9% year-over-year, with a net loss of RMB923.9 million, significantly higher than the RMB248.8 million loss in the prior year period.

• Loss attributable to ordinary shareholders was RMB743.1 million, with basic loss per share at RMB0.623, compared to RMB192.3 million and RMB0.161, respectively, in the prior year period.

• No interim dividend was declared for the period.

• The company is actively pursuing asset disposals, cost control, and new financing to address liquidity and solvency risks.

Financial highlights

• Revenue decreased 15.9% year-over-year to RMB1,242.5 million.

• Gross profit fell 32.4% to RMB201.2 million; gross margin dropped to 16.2%.

• EBITDA declined 74.7% to RMB159.7 million.

• Administrative expenses rose 37.1% to RMB221.8 million, mainly due to asset impairment provisions.

• Net finance costs increased 25.5% to RMB616.7 million, driven by higher borrowing costs and exchange losses.

• Cash and cash equivalents fell 19.4% to RMB725.2 million.

• Gearing ratio increased to 92.29% from 89.71% at year-end 2023.

Outlook and guidance

• Focus on improving quality and efficiency, accelerating debt collection, and disposing of inefficient assets.

• Plans to secure policy relief funds, broaden funding sources, and complete projects to increase income.

• Continued emphasis on risk management, internal controls, and legal risk reduction.